AirAsia CEO, Tony Fernandes, stated the carrier is considering paying dividends (Reuters, 24-Jun-2010). The carrier has not had a dividend policy since its listing in Malaysia in 2004, as it wanted to reinvest profits for future capital requirements. Mr Fernandes stated the group plans to offer 30% of Indonesia AirAsia and Thai AirAsia in their IPOs next year.

AirAsia:“The board is actively looking at it … we are in a much better position [than last year] to be considering a dividend … We have solved a lot of uncertainties in AirAsia and there is clarity for shareholders over the airline's business,” Tony Fernandes, CEO. Source: Reuters, 24-Jun-2010/Malaysia Business Times, 25-Jun-2010.

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AirAsia has joined other leading LCC groups in Southeast Asia by deciding to add higher density narrowbody aircraft. The 100 A321neos ordered by AirAsia at the 2016 Farnborough Air Show will enable the group to maximise slots at infrastructure constrained airports and further reduce unit costs.

The new order also enables the AirAsia Group to meet a requirement for additional aircraft that has surfaced due to the establishment of a leasing subsidiary which is looking at potentially placing some of the group’s future aircraft with third party customers. AirAsia joins rival Lion Group and VietJet Air in pursuing potential opportunities to lease out some of 1,150 aircraft the three Southeast Asian groups have on order – a staggering number of aircraft that likely cannot be absorbed entirely by their own airline subsidiaries or affiliates - but which they need to have available in case high forecasts materialise.

The new deal lifts AirAsia’s narrowbody order book to 404 aircraft, including 304 A320neos to be delivered from 2H2016 through 2028 and 100 A321neos slated for delivery from 2019 to 2028. The group took its last A320ceo in 2Q2015 and currently operates 171 of the type from bases in five countries.

The AirAsia Group is planning to accelerate expansion in 2017, with several additional deliveries. The short haul LCC is bullish on its prospects for 2017, particularly in India, Indonesia and the Philippines which are on course to achieve profitability by the end of 2016.

The group is also hoping to benefit from more favourable conditions in its original home markets of Malaysia and Thailand. While AirAsia has remained profitable at a group level over the last two years it has been impacted by relatively challenging conditions in Malaysia and Thailand and steep losses in India, Indonesia and the Philippines.

The group’s fifth joint venture, AirAsia Japan, is now slated to commence operations in 1Q2017. Japan will help drive a new phase of growth after a hiatus from fleet expansion over the last two years.